The Y&H

“Good afternoon. Ahead on CITYpulse News… Toronto is suffering a condo crash. The warning from experts is that the building boom and a market slowdown hit the GTA in the worst possible way… and new research reveals that slouching is not just bad for posture, it’s also bad for your mental health….”

Another day (what election?). Another news cycle. Global TV in Vancouver and CITY in Toronto discover crumbling condos within hours of their two newscasts. Reuters moves a story picked up by scores of publications and sites. “Canada braces as housing slowdown takes hold,” is the headline at Fox News. And as I told you last week, even the Wall Street Journal’s jumped onto the trash-Canadian-housing meme with a story days ago guaranteed to keep rich investment bankers safely on their side of the border.

At some point, which is probably now, all this becomes a self-reinforcing event. Real estate can’t function without investor confidence, and when people perceive that other people are getting freaked at housing risk, it’s over. Market momentum turns negative, sales slump and in due course prices follow.

For some time this pathetic blog has told you it was coming, although the unwinding is still in its formative stages. Media will push that ahead, but it’s not until soccer moms or your idiot relatives start yakking about how the ‘smart people’ are selling or downsizing that it will fully flower. That’ll take a few more months, then the price plop.

No group will be more devastated than the Young & Horny. Five per cent down payments, cash-back mortgages, high-ratio insurance, Ottawa’s first-time homebuyer tax credit, zero-down and 40-year ams, the BC First-Time New Home buyer’s Bonus and the RRSP Home Buyer’s Plan have understandably made these people think The Man wanted them to go crazy with property. Pimping right along have been the big banks, all pouring out guides and incentives along with fat mortgage pre-approvals. And how could we forget Tube Top Sandra and her little Property Virgins? (“I’m lovin’ the crown mouldings, Sandra…”)

Last year more than half of all real estate transactions were by first-time buyers. That number was just 36% in 2008, catapulting to 43% the next year when emergency rates came into effect, and has been inching ahead since. At the same time, average down payments have been collapsing, and now average just 7% of the purchase price. As Canadian mortgage debt soared past the trillion-dollar mark two years ago, it was largely on the backs of the young and inexperienced, talked into stunning leverage by realtors, bankers, politicians and their fool parents.

Now, the cruel joke. After doing exactly what society was pushing them to, the kids are being hung out to dry. Forty-year amortizations have turned into 25. Cash-back mortgages which eliminated the need for a down payment have themselves been snuffed. Debt-service ratios have been hiked making borrowing harder. And the elfin deity himself, F, has been warning darkly about too much debt while central bankers tell everyone to stop buying houses and save and invest instead.

All this has worked. Condo sales have crashed. Listings are piling up and first-time sellers wonder what the hell just happened. Wasn’t this stuff supposed to go up forever? We’re now just months, or weeks, away from tens of thousands of young real estate ‘owners’ in Toronto alone being seriously under water. One year ago, that was unthinkable.

This week 90% of people aged 18 to 24 told pollsters for Sun Life that they have “excessive stress” because of economic uncertainty. That compared with a mere 72% of the larger population who say they are “uncomfortably stressed” because of the economy. Crappy youth employment numbers and burger wages for MBAs are a big part of the reason for the Y&H jitters, but at the heart of it all is an old foe. Debt.

Seems a lot of property virgins thought they had an answer to this – ignore it. Instead of worrying about the big steaming pile of borrowed money, just focus on the monthly. As long as that’s manageable, no problem, since inevitable gains in real estate equity will wipe out the debt when you decide to walk.

F and his minions put an end to that on July 9th. Toppling sales in the fast-flipping condo market have meant a flood of supply over demand, mounting illiquidity and an end to rising values. Those brand new sellers now find if they want a deal they have to bail for less than ‘market value’, which is exactly what’s happening. In some of the glass towers in downtown Toronto, little units fetching over $300,000 eight months ago have lost almost 20% of their value. If you bought one with 5% down, wouldn’t you be stressed, too?

Some see this as betrayal. They’re right.

208 comments ↓

#1 Hoof - Hearted on 11.06.12 at 8:45 pm

Fiiirssssttttttt !

#2 TurnerNation on 11.06.12 at 8:52 pm

#46 Smoking Man yesterday

See the traders know, this is not a spectator sport. Get out there and trade (post?). This weblog is an idea generation machine. I find trading ideas all the time. We are all seeking alpha…

#3 Mr Buyer on 11.06.12 at 8:53 pm

self evident

#4 Interesting Times on 11.06.12 at 8:55 pm

HGTV Virgins get out there and start low balling these realtards by 50 percent. Don’t waste your time going to open houses when you could just sit on MLS and low ball these used car salespeople by email. Get out there and get your revenge, show them that you are not as stupid as the show portrays you!

– jobs being lost everywhere still and the Canadian economy is slowing down.

– austerity starting already in Canada. Many in government jobs will be bye, bye.

– all manufacturing jobs have moved to Asia and back to the US.

– 70 percent of CDN living pay cheque to pay cheque and have no savings.

– empty condos being built everywhere and will be going for 50 percent off soon.

– Canadians are 163 percent in debt! More than the US, Ireland, and UK when they had there crash.

– Over 6 months of dropping RE sales.

– And remember a home is only worth what a buyer will pay.

The 50 percent crash is here my virgins get out there and start low balling as the time is now for your revenge. Don’t sign up for bank slavery like the other 70 percent of the virgins in Canada. They are screwed for life now as they were sold the Koolaid by the RE industry!

#5 martin9999 on 11.06.12 at 8:56 pm

romney 33 – obama 3

what’s happening, still to early to tell tho

#6 Nostradamus Le Mad Vlad on 11.06.12 at 9:02 pm

-
“As Canadian mortgage debt soared past the trillion-dollar mark two years ago, it was largely on the backs of the young and inexperienced, talked into stunning leverage by realtors, bankers, politicians and their fool parents. Now, the cruel joke.”

A great aspect of living an independent life, ignoring just about everyone / thing and being true to oneself, is that one is no longer under someone else’s wings, that all are free to make as many mistakes as possible then learning from those mistakes, consequently having a much better life.
*
2:44 clip Mitt Romney. Who he? Greece ceases functioning, and US per person debt now higher than Greece; 2:22 clip Georgia runs out of food stamps; US foreign treaties for the populace; US Suzuki files for bankruptcy. Too many cars and bikes, not enough people; Iran and Af’stan Building new oil pipeline; Hard Assets increasing in value; France Good tax break for businesses; Kodak Retirees lose benefits.
*
Damned if you do . . .; The Koreas and India – Pakistan Wars all over; 44:18 doc. The Disappearing Male. Ladies, the planet’s all yours! 3:15 clip It doesn’t matter who is elected, someone else still calls the shots in NAmerica; Cyberspace Threat China biggest threat to US; Two nine min. + clips Diebold and YouTube — brothers in arms; Stingers A product of the US military complex being used by Syrian rebels; Kuwait The west’s latest stop.

#7 Andrew on 11.06.12 at 9:08 pm

Treb numbers are updated for October. Illustrates some of the trends that Garth has been talking about.

http://www.torontorealestateboard.com/market_news/housing_charts/index.htm

#8 Old Man on 11.06.12 at 9:10 pm

The key to Garth’s article is ‘ investor confidence ‘ as if they see the tide turning will all run for the door at the same time which equates to a rush of sales to the bottom. Now want you all to remember the bidding wars which was a rush to the top, so now this all becomes a boom and bust scenerio – down she goes, as have seen this all before, but the bubble is much bigger, and all hell is going to fly.

#9 Min in Mission on 11.06.12 at 9:19 pm

Holy Smokes,
I was driving home, here in the Fraser Valley, and heard the newest way to get into home ownership.

“lease to own” What a great concept!!

Wish that I had thought of it!!

#10 JSS on 11.06.12 at 9:19 pm

Garth –
I’ve noticed that you hardly mention Alberta (Edmonton, Calgary) in your articles anymore.

Are we to assume that Vancouver and Toronto are the only Canadian cities in trouble?

Just more comedic. — Garth

#11 FTP - First Time Poster on 11.06.12 at 9:24 pm

Apparently, according to our local rag here in Edmonton, all the HAM is headed our way! Hahahahaha…….FAIL

http://www.edmontonjournal.com/business/real-estate/Calgary+Edmonton+displace+Toronto+Vancouver/7504861/story.html

#12 Smoking Man on 11.06.12 at 9:25 pm

#2 TurnerNation on 11.06.12 at 8:52 pm

Yes 100 % true, We got to do the duke some time this year, and trade lies. :)

#13 Aaron - Melbourne on 11.06.12 at 9:26 pm

The dismal science getting the boot at University of Western Sydney. Just happens to be where Steve Keen works.

Professor Keen says it will be sacrificing intellectual rigour in an area where it has been leading to this point.

“[Getting rid of the economics discipline is] doubly or triply ironic because, not only is it an economic crisis that’s dominating the world’s decision making today, but people realise there’s a need for an alternative perspective on economic theory and economics at the University of Western Sydney has prided itself on giving a broad pluralist education to students, teaching them both the mainstream and non-mainstream views for the last 15 years,” he added.

“Of course, I work there, and I’m one of the few economists acknowledged as having seen this crisis coming, so it’s bizarre that the university can ignore all that and simply propose to cut the department completely, simply as a way of coping with costs.”

http://www.abc.net.au/news/2012-11-06/uws-set-to-ditch-economics/4355272?section=business

#14 Randy on 11.06.12 at 9:28 pm

In the words of Alfred E Neuman…”What me Worry ?”

http://www.businessinsider.com/recession-probabilities-index-2012-11

#15 claudius emperor on 11.06.12 at 9:33 pm

gold did pretty good today…

comments?

#16 Realtors are in an all out panic on 11.06.12 at 9:37 pm

It’s going to be a NASTY crash realtor smokingman , a NASTY crash!

#17 think again on 11.06.12 at 9:38 pm

When the wind blows hard even turkeys fly!

#18 IvanDrago on 11.06.12 at 9:45 pm

Vancouver condos are dead. Toronto next. Queue the tears and lawsuits.

Enough real estate talk already. Garth, is it time to load up on RIM stock for the BB10 launch in the new year? I need a winner after getting my ass kicked on oil and mining juniors this year!

#19 2centsCdn on 11.06.12 at 9:45 pm

Woo hoo! this is going to be exciting. I did a back roads drive from Mississauga up through Brampton, Kleinburgh, King City and Richmond Hill this afternoon …. I can not believe the number of residential subdivisions either just starting or fields with signs saying “register now for plan viewing appointment” ….. absolutely shocking. The incredible number of builders and hundreds of millions of dollars teedering on the edge of this shit storm gives me chest pains. It’s not even my money. I’m as shocked at the builders risk threshold as I am at the kooks who line up to buy and bury themselves financially. Save up some down payment money kids .. there’re going to be some bankrupt builder deals in the next year or two.

#20 Freebird on 11.06.12 at 9:46 pm

Some TV shows are now working n behalf of their big bank sponsors to help keep buyers continuing to sign for those mortgages and HELOCs for renos. Just recently The Marilyn Denis Show ran a Wealth Through Real Estate show. I don’t blame MD, her show is under the CTV network which had CIBC as a major sponsor (hence the regular appearances by CIBC reps). What was interesting is HGTV ‘star’ Scott McGillivray from Income Property was on the building was on the MD building wealth episode with a very impressive how to earn a million dollars through income property chart…a few details missing but OK. Go to Scott’s website and you find he is now doing wealth building seminars – using real estate – with a big CIBC logo behind him on stage…ahhh follow the money! Listen everybody wants to earn their buck so OK but SG actually used to give really great advice about real estate until recently. I guess everyone has their price.

#21 NotAGreaterFool on 11.06.12 at 9:48 pm

This is great read – NOT!

http://canadamortgagenews.ca/

Best part is “if your home goes up by 5% each year, on average (and this is probably a realistic number looking back at historical values), then your home should be worth $1.4million or double what you paid”

#22 };-) aka D.A. on 11.06.12 at 9:51 pm

#187 Form Man on 11.06.12 at 8:51 pm
#180 DA

Sopa Square needs sales in the worst way. Problem is their prices are still too high. Certainly is a nice developer in need of a helping hand……

Now that is something which I agree with you on all accounts.

It would be a shame to see it go the way of The Conservatory.

I think Sopa Square will eventually find its groove but first it must realize it’s price point from which, hopefully, it’s not too late to work back from. Invue did it and I think Sopa Square has an advantage over them in that they’re not so vested quite yet.

#23 Smoking Man on 11.06.12 at 9:55 pm

#16 Realtors are in an all out panic on 11.06.12 at 9:37 pm
It’s going to be a NASTY crash realtor smokingman , a NASTY crash!

It is LaughingCon It is, for Condos.

Not 416 SFH, Not even HUGE price spike in the spring coming boy.

#24 Freebird on 11.06.12 at 9:55 pm

BTW for those who keep referring to HGTV Google “the truth about house hunters” and you if you did believe before that there is very little real in reality TV, this WILL help convince you! Hint: you don’t qualify for the show unless you already have a deal signed to either buy or rent a place and two of the places shown are red herrings and for show only! I guess it helps sell real estate in the areas shown and gives the agents shown some on air ad time for them. I also love when Sandra from Buy Herself asks new buyers if they really want to lose their DREAM place for $10-20k over their budget when monthly it’s only $50 or a $100 extra per month! News flash its still over budget and maybe over valued!

#25 Fleabitten Monkey on 11.06.12 at 10:00 pm

I love the statement this realtor makes “it was a bit of a scam going on and someone was left holding the pot at the very end”…..priceless

#26 Smoking Man on 11.06.12 at 10:08 pm

The Election right now

Obama Approx 51%
Romney Approx 49%

The Machine 100%

#27 Dave on 11.06.12 at 10:08 pm

Garth,

I love your articles written on: economy, politics, investment strategies, etc.

For what it’s worth….articles written like this evenings post – where the subject is real estate; I now just briefly skim read. I am sure a big part of your audience is the RE doomer crowd.

Love your consistency on posting every night at around 8:30 – 9:30pm EST. You can set your watch to it….

I am curious to hear your thoughts on a responsible people investing conservatively with a tax deductible investment loan.

PS – How I could forget the pictures!!!! They are always classic….

#28 John on 11.06.12 at 10:24 pm

meme? Are you french or something?

#29 martin9999 on 11.06.12 at 10:33 pm

15claudius emperor on 11.06.12 at 9:33 pm
gold did pretty good today…

comments?
—-

i am quite surprise for the reversal. its still losing some ground tho. if romney makes it tonite i believe gold is caput. probably we are gonna se 1400$ some times soon

#30 martin9999 on 11.06.12 at 10:33 pm

addition- i am still shortening it

chears

#31 aaci-home dog on 11.06.12 at 10:36 pm

Aahh yes…I love picnics…
Not many of the expensive homes around here are selling. Maybe sales promotion techniques need tweeking.
Asking $1.5 million ? Try $1,500 thou…
$1.2 million ? How about $1,200 k…
There now…doesn’t that make you go buy a mcmansion ?
Nah…didn’t think so (sigh).

#32 Hugh Jasz on 11.06.12 at 10:43 pm

#21 NotAGreaterFool on 11.06.12 at 9:48 pm
This is great read – NOT!
http://canadamortgagenews.ca/

My own favourite gems from this warm pile of bull leavings:

………..In that 10 years, the goal is to pay down your mortgage by at least half, if not more. (a realistic goal considering the average Canadian pays off their home in 12 to 17 years).

Really??? Based on what I read here and other financial blogs, the average Canadian has household debt at something north of 150% income…….are you telling me that none of this debt, held by the same average person is on their home?

Guess HELOC’s don’t count when assessing whether a home is paid off.

Guessing also that discharging a mortgage when you sell counts as “pays off their home” whether you port to a new mortgage on a new home or not.

if your home goes up by 5% each year, on average (and this is probably a realistic number looking back at historical values), then your home should be worth $1.4million or double what you paid.

This one’s a right up there with “The cheque is in the mail” or “I’ll love you till the end of time”

-Unless I don’t understand the new math, 5% a year for 10 years compounds to about a 63% gain, not a doubling.

-Assuming 5% average year over year price gains for the next 10 years is probably a touch on the optimistic side. “BLACK” at Niagara Fallsview has far better odds.

#33 Jounce on 11.06.12 at 10:44 pm

The Bank’s drank their own koolaid, and just now are sobering up to how they have ruined their balance sheets.
The next stage for the ‘dispossessed mortgagers’ and their bankster sith lords are soiled sheets and night sweats.

#34 PatientlyWatching on 11.06.12 at 10:48 pm

I think with the housing bubble bursting, Canada will not make out much better any of the other countries in Europe have recently. I think there is a myth that Canada is somehow “smarter”, more “ethical” and all that other trite infantile spoon fed shit most TV educated folks espouse like a desperate prayer. I cannot imagine how any reasonable adult could without as much thought as generally given to clicking on a web page link, can think that it has never been different anywhere else, but it will be different here. Having been at an unnamed corporation and seeing firsthand the outright unashamed underhanded dirty dealings of the upper echelon, I cannot imagine Canada being immune to corruption. We will in time learn all the details, the massive unimaginable conflicts of interests, fraudulent book keeping, predatory practices, and a plethora of imaginative scams currently seen as legitimate. We will one day marvel at their brazen acts, and wonder why it was not more obvious.

#35 Old Man on 11.06.12 at 10:54 pm

#27 Smoking Man – get with the agenda as those figures mean nothing in USA, as it is electoral college votes that count to elect the President, and am holding my breath, as have money bet on Romney.

#36 Mitt Romney on 11.06.12 at 11:04 pm

Hey..its a close vote…can some of you Canadians VOTE…(then I will delay you becoming the 51 st state )

#37 Barack Obama on 11.06.12 at 11:05 pm

Vote for me…….Hey..its a close vote…can some of you Canadians VOTE…(then I will delay you becoming the 51 st state )

#38 Herb on 11.06.12 at 11:12 pm

“Now, the cruel joke. After doing exactly what society was pushing them to, the kids are being hung out to dry.” – Garth

So let’s not forget to blame the victims.

#39 Dr. WAYNE on 11.06.12 at 11:20 pm

#1 Hoof – Hearted on 11.06.12 at 8:45 pm

Fiiirssssttttttt !

YUP … you’re the first a$$hole alright …

#40 Not 1st on 11.06.12 at 11:21 pm

50% of the American people voted for a guy that supports polygamy, believes Jesus lives in Missouri and that his magic underwear will take him and 100,000 of his fellow believers to the promised land one day.

Yup this is definitely an ascending society indeed.

Just a hunch, but I think it might have been his business experience. — Garth

#41 Smoking Man on 11.06.12 at 11:24 pm

#36 Old Man on 11.06.12 at 10:54 pm
#27 Smoking Man – get with the agenda as those figures mean nothing in USA, as it is electoral college votes that count to elect the President, and am holding my breath, as have money bet on Romney.
…………………………………………..

Ha, Old Man time for some Vitamin B12

Over your head.
What part about THE MACHINE 100% did you not get.

I still love ya

#42 patiently Waiting on 11.06.12 at 11:26 pm

# 8 Old Man
The key to Garth’s article is ‘ investor confidence ‘ as if they see the tide turning will all run for the door at the same time which equates to a rush of sales to the bottom. Now want you all to remember the bidding wars which was a rush to the top, so now this all becomes a boom and bust scenerio – down she goes, as have seen this all before, but the bubble is much bigger, and all hell is going to fly.
—————————————————————-

Old Man is right. The debt loads that people are carrying that I see is unreal, simply jaw dropping to see what risk people are willing to take when they have been lead to believe that there is no risk in real estate. We have only F and his cronnies to blame. Here a few example of what I came across a few today:

1) High end home in Langley’s ritzie High Point hood. 1st Mgt. $1,750,000 at 8.75%. 2nd Mgt. $250,000 at 12.4%. Assessed Value = $1,332,000. Mkt Value likely around $1.7 – 2.0 mil

2) High end home (8,800 sq ft) on 33 acres in Langely. Asking $2,848,000. 1st Mgt. $800,000. 2nd Mgt. $200,000 (Prime plus 5%), 3rd Mgt. $1,150,000 (monthly on this alone is $9,700), 4th Mgt. $210,000 at 15%.

Oh and there are two notices of Pending Litigation on title by the lenders looking to foreclose.

There are so many others that I see that are like these that I simply cannot believe my eyes. How the f__K do so many people get into these situations. Hw the f__k do this idiot lenders give them the money? The sheer number that I see like these tells me that this market correction is going to much much deeper than the media is letting on . . .

pw

#43 Tripp on 11.06.12 at 11:29 pm

One of the top real estate pumpers on CFRA:

http://www.ottawasun.com/2012/11/06/prominent-ottawa-real-estate-agent-marnie-bennett-suspended-fined

#44 Djb on 11.06.12 at 11:30 pm

All markets are driven by investor confidance. The R/E market is just like the stock market but is very illiquid. Does anyone have confidance in RIM?….. Didn’t think so

#45 Burnt Norton on 11.06.12 at 11:36 pm

Garth, you really must be commended for your efforts in trying to warn the Y&H about the perils of RE ownership over these past few years. I’m sure those who listened are extremely grateful.

I preach safe house sex. — Garth

#46 Smoking Man on 11.06.12 at 11:37 pm

All you end of the worlders, lets just say shit happens, Boom, we are all broke. What is your plan B, Guns and amo.

Cut the heads off of the machine.

Me, I’m not violent, I will go to amish country, covert, praise the lord.

Now those bugger want you to work, I do, I pull my back. play the sympathy card.

BOOM

life is so easy and clear for me. I am a Smoking Man

#47 Bottoms_Up on 11.06.12 at 11:41 pm

#33 Hugh Jasz on 11.06.12 at 10:43 pm
—————————————-
Yep, their big mistake is looking to the past to predict the future.

The game has changed, the next 10 yrs will not be recognized by the past 10. We will be lucky to have home prices rise faster than inflation. Likely won’t happen given all the variables Garth has discussed. 1st time buyers cannot pay off their homes in under 20 years, especially when purchased with 5% (or less) down, and 30, 35, 40 yr am’s.

#48 Bottoms_Up on 11.06.12 at 11:45 pm

#25 Freebird on 11.06.12 at 9:55 pm
—————————————–
yes, this was confirmed when I spoke to someone from Toronto who knew a couple that was on property virgins. Their show was entirely staged, they had actually already purchased a place and the show was filmed ‘in reverse’. Much of reality tv is scripted–as long as you know this, then you can just take it for what it is — trashy, entertaining tv.

#49 Kim on 11.06.12 at 11:54 pm

Djb #44

I have confidance in RIM and if you don’t know anything about BB10 you should educate yourself on it. Btw Women love their blackberries and we will never give them up. Millions of us have held on to our old blackberries for so long and in need to upgrade. Take a look at BB10 and see what it can do. Hub, peak, flow and french toast are just a few cool tricks . RIM has said it has saved the best for last. IvanDrago #18 you work at bell , rogers or telus? Just asking as I have been hearing those who been had a chance to test BB10 have been buying RIM shares. Considering that since RIM announced BB10 testing by 50 carriers around the world the SP has just gone up.

#50 Smoking Man on 11.06.12 at 11:56 pm

#40 Dr. WAYNE on 11.06.12 at 11:20 pm
#1 Hoof – Hearted on 11.06.12 at 8:45 pm

Fiiirssssttttttt !

YUP … you’re the first a$$hole alright …
…………………………………………………………

Wayne, that was un called for, First invoked an $$hole response. Pun intended.

Might a suggest a BackPage stress relief experience.

#51 Old Man on 11.07.12 at 12:02 am

The best coverage for this three ring circus in USA can be found on Huffington Post in Canada, and in fact hit it daily as they pale the Canadian media with news in Canada.

#52 Bo Xilai on 11.07.12 at 12:05 am

I would scream at the TV every time Sandra would advise the Y & H

“Don’t think about how much debt you’re taking on, just focus on how much of a monthly payment is manageable”.

Such poor advice from such a biased source…

#53 Smoking Man on 11.07.12 at 12:09 am

Obama, kicking ass
Dem’s got the senate
Dem’s get congress, I think, 3.2 glasses. trying to keep it together.

Then again
MACHINE 100%

Victory for the people….. LMAO

People are so stupid, they deserve to be abused.

#54 squidly77 on 11.07.12 at 12:13 am

#10 JSS on 11.06.12 at 9:19 pm

Apparently, according to our local rag here in Edmonton, all the HAM is headed our way! Hahahahaha

Edmonton prices would need to spike 20% just to be where they were at 5 years ago. Chances of that happening. Zero.

The only Ham Edmonchuck will see is what you see when you look in the mirror. Remind me again which farm animal provides us with Ham.

#55 Smoking Man on 11.07.12 at 12:15 am

Ah all the hero worshipers at the Obama party.

Why can’t people just look in the mirror, and say. fk the president. I’m the rock star.

Conclusion, Biological Hard Drives are so easily formatted and re jigged.

Coming to you from a Dyslexic Code Smith.

ok Gartho, room spinning last one I hope.

Night Night BUBBLE HEADS

#56 daystar on 11.07.12 at 12:18 am

Just a hunch, but I think it might have been his business experience. — Garth

Yeah. And a good chunk of them were either unaware or looked the other way with stories like this. The vid was from a Newt Gingrich superpac ad but it doesn’t matter now:

http://www.youtube.com/watch?v=aLOQitODAFI

Obama wins!

#57 tkid on 11.07.12 at 12:20 am

Silver is up almost a buck an ounce, gold is up 12 bucks an ounce since 6 or 7pm, 40 bucks since this afternoon.

I know this isn’t a precious metals blog, Garth, but these are quite the moves in the market. Will the prices remain up?

#58 V on 11.07.12 at 12:22 am

update
obama wins!

#59 FTP - First Time Poster on 11.07.12 at 12:25 am

Looks like Obama is going to win. So lets recap what he achieved in the first 4 years he was in office:

•In 2007, the unemployment rate was 4.6%; 146 million people, or 63% of the working age population, were employed; and 78 million Americans were not in the labor force. Today, after three years of “recovery”, the unemployment rate is 7.9%; 143 million people, or 58.8% of the working age population are employed; and 88 million Americans are not in the labor force.

•Real median household income was $55,039 in 2007. It has fallen by 8.2% to $50,502 today.

•BLS reported inflation has risen by 12% since 2007. True inflation has risen at twice that rate.

•Median net worth in 2007 was $126,400. By 2010 it had fallen to $77,300, a 39% drop in three years. As of today, it may be a few thousand dollars higher as stock prices have risen and home prices have stopped falling.

•In 2007 there were 5.7 million existing homes sold at a median price of $218,900. Today there are 4.3 million existing homes being sold at a median price of $183,900. Over 1 million of these home sales are foreclosures or short sales, as 30% of all the homes with a mortgage in the country owe more than their house is worth.

•Federal government spending in 2007 was $2.73 trillion. Federal government spending today is $3.8 trillion, a 39% increase in five years. GDP in 2007 was $14.2 trillion. Today GDP is $15.8 trillion, an 11% increase in five years. Approximately 25% of the GDP increase is due to increased government spending.

•Government entitlement transfers totaled $1.7 trillion in 2007. Today they total $2.4 trillion, a 41% increase in five years. Interest income paid to senior citizens and savers totaled $1.25 trillion in 2007. Today interest income totals $985 billion, a 21% decrease in five years. Wall Street bankers needed the money to pay themselves bonuses, so Ben Bernanke obliged.

•The annual deficit in 2007 totaled $161 billion. Today, the annual deficit is $1.1 trillion. We add $3 billion per day to the national debt as a gift to unborn generations.

•The national debt in 2007 was $9 trillion. Today the national debt is $16.3 trillion, an 81% increase in five years. The national debt will reach $20 trillion during the next presidential term. Normalization of interest rates to 2007 levels would result in annual interest expense of $1 trillion, or 40% of current government revenues.

So you’re expecting different results during his second term Garth? I hope not, you’ll be sorely disappointed. Why do you think gold is rising on the news of an Obama win? What are the markets telling us?

You just described the Bush legacy. — Garth

#60 Realtors are in an all out panic on 11.07.12 at 12:27 am

realtors Smokingman wrong…..OBAMA WINS

416 SFH set to CRASH and CRASH hard! In fact SFH in the 416 has crashed 10-15% just in the past three months

It’s going to be a NASTY crash realtors smokingman a NASTY crash!

#61 happy renter on 11.07.12 at 12:27 am

Well we all know real estate is tanking,but is was a great run.I only made 60% profit from selling my house in Victoria while alot of people made 100% and more.Real estate was a investment of a life time in early 2000.Now its time to find the next bubble and get out before it bursts.
Hey Garth any idea what the next bubble to get into early?

#62 Smoking Man on 11.07.12 at 12:30 am

Look at the losers on TV, it could be the Rom party tea party wacko jobs, it’s the Ob boy party. That was bad , sorry brothers.

Then again don’t see any brothers cheering. The machine put all the smart ones in jail. Ask Conrad.

Look at em. I don’t have one bit of remorse taking loot form useless hero worshiping eaters (Henry K) said that.

I wish I was an ape, or a bird. Humanity is embarrassing.

#63 GTA Girl on 11.07.12 at 12:37 am

Crash Test Dummy?

Of course the condos pre sales have sold 80% of units. That is the magic number to banks to start building.

What your charts don’t show that many units are bought by investor clusters put together by the developer. These units sold in order to attain funding to build. Then units are sold again.

Some developers know many people who want to ‘invest’ in clusters. People with cash. That don’t necessarily want their names on the paperwork.

#64 martin9999 on 11.07.12 at 12:45 am

i had big hopes for romney

#65 Hoof-Hearted on 11.07.12 at 12:50 am

#40 Dr. WAYNE on 11.06.12 at 11:20 pm

#1 Hoof – Hearted on 11.06.12 at 8:45 pm

Fiiirssssttttttt !

YUP … you’re the first a$$hole alright …
=====================================

Hey Doc…

When you’re not the lead dog in the pack ….THE VIEW IS THE S-A-M-E .

PS You and Smoking Man can share a room and try to figure that one out.

#66 Bought in Toronto on 11.07.12 at 12:51 am

RIM will not recover to its former glory but will find its niche in the business and government market with BB10 phones and the enterprise servers. The stock price was:

$140/share four years ago
$6/share four month ago
$9/share currently

It should recover to $20-25/share even if BB10 is even a moderate success with businesses. I think it is great for Canada to have a successful RIM/Blackberry company and great for Waterloo RE!

Disclosure: I hold a small position in RIM.TO bought at $7.50/share (as well as Apple +200%, Nokia +25% and Bank of America +30%)

#67 Bought in Toronto on 11.07.12 at 12:53 am

Note: I wasn’t bragging in my last post– I just sell my losers!

And there have been lots of those throughout the decades….

#68 Smoking Man on 11.07.12 at 1:00 am

Last one did not come out right.

Feel free to delete

#69 Form Man on 11.07.12 at 1:02 am

#52 Old Man

agree with you about Huffpost

#70 Debtfree on 11.07.12 at 1:14 am

Garth the magnificent called it months ago . 4 more years . Willard who ? All the gold bugs should be rejoicing . But ah gold bugs . The whole world just dodged a bullet . Thank you American voters thank you very much. Come on Ben stimulate us all .

#71 Vangrrl on 11.07.12 at 1:14 am

ObaMA! ObaMA! Hip hip hooray… !!
(Now I can read Garth’s daily post)

#72 Jim on 11.07.12 at 1:29 am

#35 PatientlyWatching,

Lots of corruption in Canada. The civil service is full of it, to take but one instance. eHealth Ontario, ORNGE, etc etc. No one looks at that stuff when things are going well, and now that there is a downturn coming, you’ll see more resentment and interest from the media, particularly the private sector media. Nothing much will change though.

#73 Not 1st on 11.07.12 at 1:35 am

Look, I’m glad Obama won, but whats with the cheering and crying with the supporters? Nothings been solved yet and the country still is basket case.

Frankly, I wonder why anyone would want to be leader of this fiasco.

#74 Doug form Victoria on 11.07.12 at 1:42 am

It’s taking hold… My wife’s hair dresser commented they just sold their townhouse in Victoria and rented the one next door. He said they felt the market was turning and wanted to cash out.

#75 Nostradamus Le Mad Vlad on 11.07.12 at 1:43 am

-
Soros, Obomba’s Master The anti-Christ? Steve Kroft interview, and Nate Silver nearly had the election at 100% correct; Food Prices Up again; Sleepy Portfolio 3Q report; Asia wants cheaper gas prices, so BC will have to lower or lose it, and China and Singapore invest US$1 bln. in US US LNG plant; Young Cdns. not feeling very good over money; Off and Running Eventually we will all know where the economy is headed; Middle Class is in bad shape (no kidding); Natural Gas Prices going up 35% next year.
*
Louisiana Curious. Why has LA ordered 200K death certificates? Expecting something big? The Big Melt which caused the last ice age to happen has been found; Hells Grannies The male version? Croc on the Run for 18 months captured in sewers; Uruguay plans to start selling dope legally to stamp out black market. Colorado and Washington State also voted to decriminalize it; MI6 The life of a spy. Too exciting for me; Putin and Obomba Hmmm. Two top military people removed from service almost simultaneously. Coincidence? There are no such things as coincidences. Sounds vaguely familiar to DSK, who was later freed; Chocolate as Medicine? Election The winner is the one who promises to destroy America first; I See Dead People Many individuals can see the after-life, or continuation of life. They don’t know what it is, ‘tho; Necrophilia The news about Jimmy Savile gets uglier at every turn; Renault Quirky car design.

#76 robert on 11.07.12 at 1:56 am

Just moved to Kelowna BC if you want to see condo projects that never got off the ground but still sporting the marketing signs drive down Lakeshore Drive. Some are half built and vacated. For sale signs are now part of the landscape. Leased a fully furnished two bedrooms and a den condo on the water for for 1100 a month. Owner told me if i liked it he would be happy to take a loss and give me a great deal. Kelowna is still hurting huge as is Salmon Arm and Kamloops. So forget the idea that this is strictly a west and east coast correction. In fact with the Canadian economy about to contract i would expect that by June 2013 prices will contract by a minimum of 25%.

#77 Not 1st on 11.07.12 at 1:57 am

$16 trillion dollar deficit….

Obama needs to change his slogan to “no we can’t”

#78 Lukas on 11.07.12 at 2:10 am

Washington & Colorado just legalized marijuana…here comes a flood of grow-up houses in the Lower Mainland come this Spring…

#79 house burden on 11.07.12 at 2:22 am

Obama Wins, China better start writing cheques to fund a bigger and better government

#80 If you want to buy gold ... on 11.07.12 at 2:26 am

Gold is up because Obama won and his policy of Quantitative Easing (QE) stays intact. If you want to buy gold buy it in the iShares S&P/TSX Capped Composite Index (XIC.TO). Don’t buy the gold bullion, as Garth has mentioned you can’t eat it when it goes south.

#81 broadway skytrain on 11.07.12 at 2:38 am

weed legalized in WA OR and CO!

americans leading the way into the future. good for them.
hold an ounce. grow 6 plants in CO.

CA is for sure next.

BC’s got a thing or two to learn about freedom.

and, i agree, if RIM’s new OS is good the stock is an easy 4x.

#82 Devore on 11.07.12 at 3:11 am

#24 Spiltbongwater

And check out the date on that one. Not even a year later MAC marketing was slashing prices 30%, and still not selling much.

This is still one of the better realtor videos on presales in Toronto.

http://www.youtube.com/watch?v=o3IrWk0hy6Q

#83 TheBigLebowski on 11.07.12 at 3:29 am

#58 tkid
You are asking a former government banking insider ? oh how we suffer from stockholm syndrome .

#84 broadway skytrain on 11.07.12 at 3:35 am

correction OR said no , my bad. i was all excited.

gregor ‘bikelane’ robsn now says canada will follow.

#85 Buy? Curious? on 11.07.12 at 3:41 am

Aiiieeee!!!! OMG!!!! Condos prices are crashing? When did this happen? (running around the living room in a panic!) AAARRRGGGHHH!!! What’s going to happen to the 80% of condo owners who were speculators? Aiiiiiieeeee!!! Who’s looking out for the property developers who built these condos over every free space in Toronto? (sobbing on the floor) And what about the real estate agents, what’s going to happen to them? I so scared! The writing is on the wall! Hell, Smoking Man only posted 7 times before midnight. He must have been working late collecting empties.

http://www.youtube.com/watch?v=2a4gyJsY0mc&feature=related

#86 Doug in Victoria on 11.07.12 at 3:47 am

High house price + low interest = realized debt

Low house price + high interest = unrealized debt

Monthly payment might be the same, but in the old days paying down the mortage early wiped out huge amounts of unrealized interest liability that today’s buyers will be sadled with for life. Many boomers did this I think and greatly reduced their total outlay for their home, an advantage today’s buyers don’t have.

#87 Freedom First on 11.07.12 at 3:58 am

Garth, your posts lately about RE in Canada look a tad optimistic to me:) …….most unfortunate though, I have watched some of the Y&H, who I am related to, get talked into buying in the last few years by their boomer parents. I never said anything to the Y&H, but to their parents I said I am worried for them, just before they purchased. The boomers said to me, kinda rudely too…”they’ll be okay”……exact quote. Watched the Y&H buy the 60,000$ vehicle on their own though…..through their Heloc. No saving the truly foolish. But you saved a lot of the open minded Garth…….kudo’s to you:)

#88 Munchka on 11.07.12 at 4:45 am

Last???

#89 randman on 11.07.12 at 5:38 am

Garth…Seems Lord Black disagrees with your take on the
USA

Now,say what you will about him,he is still one of the keenest minds around….I think he is bang on here

“The administration added $17,000 of new debt for every man, woman and child in the country in less than four years, and most of it isn’t really debt, it’s just an inflationary money supply increase, fake notes issued by the Treasury’s subsidiary, the Federal Reserve, to the Treasury in exchange for the Treasury’s bonds to pay the hemorrhaging deficit, $188 million per hour.

There are five million fewer people working than four years ago, and there is no economic recovery. Inflation is only apparently moderate because the housing industry is bombed out, most other industries are very soft, and interest rates are negligible in an unsuccessful effort to revive economic activity, and this disguises 25 per cent annual gasoline price increases, and double digit annual increases in the price of most of the essential food and milk shopping basket, (and food stamp users have almost doubled to about 47 million, almost as many people as have criminal records thanks to the country’s fascistic justice system).”

http://www.huffingtonpost.ca/conrad-black/post_4106_b_2086100.html?utm_hp_ref=canada-politics&ir=Canada%20Politics

#90 picasso on 11.07.12 at 5:42 am

#35 PatientlyWatching on 11.06.12 at 10:48 pm

Yup, it’s no different then penny stock pump and dump sites. Same shite!

#91 JimH on 11.07.12 at 5:43 am

No surprise that with 2008 still a fresh memory, the majority of American voters didn’t flock to support a private equity hack/Wall Street insider/Laissez-faire supply-sider who is indebted to the status quo and really believes in magic classes, missing ancient tablets and the power of cosmic underpants.

The really bad news for the Republicans is that the supply of those angry old bigoted white men supporters is shrinking faster than a Vancouverite’s home equity… and, like Karl Rove, they are about as adaptable to demographic/cultural change as the fabled Dodo.

Like Churchill said, the American people always eventually get it right… after diddling around with all other available alternatives.

In the meantime, please keep on sending us that $80/Bbl crude, cheap copper, iron, lumber and coal.

You can keep those cool iPads, iPhones X-boxes and the Viagra! I have a feeling this will end well for those south of the 49th!

#92 picasso on 11.07.12 at 5:50 am

#58 tkid on 11.07.12 at 12:20 am

Gold isn’t going anywhere, up or down.

It’s trading range is between $1,600 and $1,800 for a long long time.

#93 The real Kip on 11.07.12 at 7:21 am

“And the elfin deity himself, F, has been warning darkly about too much debt while central bankers tell everyone to stop buying houses and save and invest instead.”

I don’t recall Mr. Flaherty nor Mr. Carney telling people to invest instead, they are simply warning of too much debt. I think that’s just you thinking out loud Garth.

#94 IM in C on 11.07.12 at 7:48 am

Susan Pigg, the Toronto Star’s resident real estate shill is at it again! Now that condo sales are tanking she is pumping rentals!!
http://www.thestar.com/business/article/1283748–the-sky-s-the-limit-when-it-comes-to-renting-downtown-toronto-condos

#95 futurologist on 11.07.12 at 8:06 am

the last president of USA husain obama has 4 more years to destroy USA and he will success in this.

be prepare to economic crash and following social anarchy.

#96 The American on 11.07.12 at 8:16 am

Well, we did it (yawn). Obama took 47% more electoral votes than Romney. Yeah, that sure was a close call LOL I said it months ago this isn’t even a competition. Final score, 303 to 206. Obama wins. Obamacare here to stay. World said we couldn’t and wouldn’t, and we did. Twice. The U.S. can turn on a dime, and it is when you consider the circumstances at had from just four years ago. Still, a lot of pain to muddle through and a lot of growing to do.

The Democrats have the Senate (thank the Universe) and the republCONS have the House (by the skin of their fangs).

Washington State is the first state to pass same-sex marriage by a measure of the popular vote. Washington state has passed legalization of marijuana, even for recreational usage. I’m just glad to be living in Washington State today!

#97 EIT on 11.07.12 at 8:36 am

“The plebs getting F’d” has added meaning now. Don’t worry people, government will bend the laws of physics and fix everything. It’s a cornucopia.. duh.

#74 Not 1st on 11.07.12 at 1:35 am:
Frankly, I wonder why anyone would want to be leader of this fiasco.

Dwight D. Eisenhower:
“Any man who wants to be president is either an egomaniac or crazy”

#98 thinker on 11.07.12 at 9:04 am

Garth, constantly saying “prices dropping will follow sales” means nothing. You have to still live, so you have to remove the cost of renting the flat and the unrealized loss on principal

Assume a full cash purchase

GIC at 0%

300k home, I lose say 15% over two years – 45K
300k home, I rented for 1750 a month = – 42K

I still have not realized my loss while my renting has gone to nothing. Now I think what you need to show is when that % actually wipes out renting, etc….At the moment a guy bought two years ago and has a loss of 15% is still fine. Focus and think of the true math.

Let’s not pretend we all live for free.

$300,000 @ 7% = $21,000 per year, $13,000 after tax or $1,200 per month. Run the numbers now. — Garth

#99 Bigrider on 11.07.12 at 9:08 am

http://www.moneyville.ca/article/1283748–the-sky-s-the-limit-when-it-comes-to-renting-downtown-toronto-condos

Competition for rental condos in T.O from renters. Rents being pushed up. Renters offering more than asking for rental condos.

Is there another leg up for the condo market in T.O on the way?

It’s in the Star. Must be true. — Garth

#100 FTP - First Time Poster on 11.07.12 at 9:16 am

#60 You just described the Bush legacy. — Garth

Sorry no Garth – those stats are from Q4, 2007 until now. The Bush legacy started these issues, Obama has yet to address a single one.

Wrong. That is exactly what Obama inherited, and new damage did not stop piling up until 2010. Your guy lost. Suck it up. — Garth

#101 raginnn on 11.07.12 at 9:21 am

http://www.moneyville.ca/article/1283748–the-sky-s-the-limit-when-it-comes-to-renting-downtown-toronto-condos

Why would anyone buy the Star to read garbage and misinformation such as this. No wonder they give it away for free. They just do not give up

#102 The American on 11.07.12 at 9:38 am

#60: It is people like you with antiquated and willful blindness that is all that is wrong with the U.S. If you would stop and just THINK for but even a moment, you may find some clarity. All your 2007 stats are a result of failed economic and regulatory policy under the Bush administration. The economy fell off a cliff in 2007 – not 2008 – and this is what President Obama inherited on day one when he took office in 2008. Bush hasn’t shown his face in four years. Want to know why? SHAME. His own party has all but disowned him, and he was asked NOT to attend the RNC. You do the math, friggin’ idiot.

#103 Herb on 11.07.12 at 9:40 am

“You just described the Bush legacy.” — Garth

One of your best squelches. But FTP at #60 also pitched the form of the continuing Bush “league” : throwing half-truths breaking into lies.

#104 Jeff in Moose Jaw on 11.07.12 at 9:40 am

“Classic Garth” (in reference to the Hangover)

Excellent post, this is original greaterfool material, unplugged, pure, I enjoyed it.

And Smoking Man, always entertaining – enjoy your work as well.

#105 Herb on 11.07.12 at 10:01 am

#73 Jim,

I’m aware of “eHealth Ontario, ORNGE,” but I am not aware of the “etc etc.” Would you mind clueing me in on those instances of the corruption the “civil service” is full of?

Do fill in those details and allay my suspicion that you’re just another Neandercon pitching half-truths in the hope that they’ll be accepted as credible lies.

#106 Toronto_CA on 11.07.12 at 10:04 am

Our in-house investment managers in NYC have a global portfolio of around $300bn USD; this was their take on Canada sent to me yesterday:

“It is reported that home sales in Vancouver and Toronto metropolitan areas dropped by 20-33% in
September from a year ago. Substantial declines in home sales are usually a precursor of home price
corrections. While almost all high loan-to-value mortgages in Canada have guarantees from governmentbacked
entities, a housing correction will likely impact consumer finances and aggravate credit card ABS
credit performance”

“We do not view Moody’s ratings actions as a potential concern since Moody’s generally has higher ratings
on the Canadian banks than S&P. Nevertheless, we do share Moody’s concerns about high consumer debt
levels and home prices. As a result, we have been selectively reducing our holdings of Canadian
subordinated debt.”

Word is getting out there pretty fast now. Housing market correction = recession in Canada.

#107 Buy? Curious? on 11.07.12 at 10:06 am

Hey Everyone!

Here’s a cartoon re-enactment of Smoking Man celebrating Obama’s win!

http://www.youtube.com/watch?v=0WXhO_-e3bM

Smoking Man is Randy Marsh from South Park.

#108 CalgaryRocks on 11.07.12 at 10:14 am

Interesting mention of Romney in Obama’s speech yesterday.

If he does bring him on board he may be able to push a compromise on the fiscal side that the Republicans would have to swallow since it would be supported by their nominee.

#109 };-) aka D.A. on 11.07.12 at 10:26 am

Last year more than half of all real estate transactions were by first-time buyers. That number was just 36% in 2008, catapulting to 43% the next year when emergency rates came into effect, and has been inching ahead since. At the same time, average down payments have been collapsing, and now average just 7% of the purchase price. – Garth

Where ever do you get your information?!? Those stats are utter rubbish, or could it be that you aren’t qualifying them? What was it you wrote the other day…? Oh yes…

Why are people on this pathetic blog so extreme? — Garth

To which I suggested

#169};-) aka D.A. on 11.06.12 at 5:00 pm

Maybe… because you tend to lead them down that path? Seriously… think about it.

And…

This week 90% of people aged 18 to 24 told pollsters for Sun Life that they have “excessive stress” because of economic uncertainty. – Garth

Is it any wonder with such stress promoting blogs as this populating the internet?

Why ever would people aged 18 to 24 listen to old farts like you and me anyway. That being said they have their whole lives ahead of them unlike you and me whose is behind us.

My best advice to young people… take risks while you have time to make up for the losses that might come of them, which will be a lot less than you might imagine. Education is a bargain at any price and the earlier you acquire it the better your life will be. Don’t be afraid to fail once in a while for if you aren’t from time to time you aren’t trying hard enough. In this soft coddling world failure isn’t nearly what it once was. Don’t listen to such know it all old farts as Mr. Turner and me. We don’t know shit. This is now your world far more than it is ours. You know the future better than we. Make your own rules live by your own rules. We certainly didn’t make things so much better as we profess did we? Hopefully you can do better, but doing what we say isn’t the answer as clearly by so doing you’ll get more of the same.

#110 };-) aka D.A. on 11.07.12 at 10:46 am

Nothing really matters and what if it did?

http://tinyurl.com/av48lzh

#111 EIT on 11.07.12 at 10:53 am

Goodmorning Amarica, such a nice day.. Obama is still in.. birds are in the sky.. o wait. no. holdup. Suzuki US just declared bankruptcy.. nevermind.

#112 Uwinsome on 11.07.12 at 11:05 am

The Guru said:

“A clear Obama win will rally markets.”

Hmm….

#113 Tony Right on 11.07.12 at 11:24 am

Damn Boomers, got us again!

#114 PoorgEoisie on 11.07.12 at 11:25 am

Gotta love the star, Susan Pigg says rental bidding wars are the new norm in TO
http://www.moneyville.ca/article/1283748–the-sky-s-the-limit-when-it-comes-to-renting-downtown-toronto-condos

A link at the bottom of the page

http://www.moneyville.ca/article/1228289–finally-a-renter-s-market-for-condos

#115 peter on 11.07.12 at 11:26 am

When does your Obama stock market rally start? Apparently, not the day after the election.

Didn’t your mom tell you about patience? — Garth

#116 Seven Stars and Orion on 11.07.12 at 11:27 am

#99 thinker on 11.07.12 at 9:04 am

Total pwnage.
That’s gotta hurt.

#117 Inglorious Investor on 11.07.12 at 11:28 am

The real problem with what happened last night…

I have always maintained that at least since Kennedy it matters little who the POTUS is, or what ‘party’ he represents. Therefore, I cared little about who would win last night’s contest.

Given the state of the States today, there is little room for political ideologies in government. The members of executive and legislative branches will have to set aside partisanship and together act decisively, quickly and effectively in order to manage the country, and the world, through the current challenges. The stakes are just too high.

However, the real problem that I saw last night, and indeed throughout the election, what not the candidates per se, but the people who voted for them.

When Obama made history four year ago as the first half-black man in history to become the POTUS, it was understandable, and encouraging. After eight years of ruinous policies––by a cadre of old white, Neo-cons, represented by a quasi-retarded, pseudo-yokel from the Eastern Establishment, and a guy who could frighten Darth Vader with his command of the dark forces––it was time for a real change.

In so many ways, Obama was the very embodiment of that change. Young. Good looking. Athletic. Fresh. Articulate (at least with a teleprompter) Black, but not too black for the white folk who like to pretend they have absolutely no racial biases. In short, he was perfect. Hmmm…

Today, the country is, by many measures, in much worse shape than it was four years ago. Despite what some say, it’s not all Bush’s fault. And yet, the majority of American voters are willing to give Obama a second chance to fulfill the ‘dream.’ That’s all fine and good and not without precedent. Roosevelt was re-elected twice during the Great Depression.

But I challenge anyone to survey people who voted for Obama and ask them to explain such policies as the NDAA; The Patriot Act (which Obama extended); ‘Obamacare’ (no, it’s not like Canada’s publicly-funded insurance system); the ‘Bush’ Tax Cuts, which Obama extended; the Secret Kill List; TSA naked body scans,which Obama endorsed; and of course, his military actions (both covert and overt) in Africa and the Middle East. Ask them if they understand these policies and actions. I think we can guess what the results would be.

I’m not suggesting Romney supporters were any more knowledgeable or enlightened. This comment is not a criticism of Obama supporters only. It’s a criticism of the electorate at large. Because, just as I said above that there is no room for partisanship right now, there is also no room for an ignorant electorate. Now, perhaps more than any other time in American history, the US needs a well-informed, politically active citizenry.

Rather than looking all starry-eyed at their supposed saviour for the next four years. Perhaps Americans, and all the people of the world, should look at what he actually does. And then take some responsibility and action to affect the kinds of positive changes the country and world really need.

Does the include you running for office, or supporting a candidate? — Garth

#118 In the Doghouse on 11.07.12 at 11:34 am

There’s always a few bad apples in the real estate barrel to spoil the other 5 % .

#119 so it begins... on 11.07.12 at 11:47 am

the star has an article about Rental Condos new bidding War.

I call B.S. these RE pumpers are ridiculous.
I checked out MLS and found hundreds along the Yonge subway line.
Don’t be fooled – speculators who can’t sell will try to rent, its the same game plan for everyone. Rents in condos will fall before rising again.

#120 Inglorious Investor on 11.07.12 at 11:56 am

“Does the include you running for office, or supporting a candidate? — Garth”

I’m too principled to run for political office, and one’s energies can be much better spent than on supporting a single MP, or even presidential, candidate. You know better than that.

You just lost the right to criticize. — Garth

#121 FTP - First Time Poster on 11.07.12 at 11:56 am

Wrong. That is exactly what Obama inherited, and new damage did not stop piling up until 2010. Your guy lost. Suck it up. — Garth

I love these debates and dont take them personally, but just so you know, I dont have a guy – or a vested interest. Besides, it wouldnt matter who won – you will see 4 more years of the same, only worse.

#122 Tony on 11.07.12 at 11:58 am

Re: #11 FTP – First Time Poster on 11.06.12 at 9:24 pm

Home prices in both Calgary and Edmonton will be lambasted as oil drops below the key resistance level of $34.50 U.S. next year. The election is over in America and all the lies will be swept under the rug. Flip a coin heads America will be in a recession next year. Tails America will be in a depression next year.

#123 Form Man on 11.07.12 at 11:58 am

DA

continuing our examination of Kelowna developments desperate for buyers…….

not wandering far from Sopa Square, we find :

Mission Meadows
Waters Edge
Southwind at Sarsons

Since these locations are all good, one is surprised at the limp demand. I will let you explain why……….

#124 45north on 11.07.12 at 12:06 pm

Inglorious investor: And then take some responsibility and action to affect the kinds of positive changes the country and world really need.

and Garth’s reply:

Does that include you running for office, or supporting a candidate?

pretty funny

speaking of responsibility and action, Elizabeth Warren was elected as a senator of Massachusetts:

http://www.foxnews.com/politics/2012/11/06/warren-defeats-brown-in-massachusetts-in-latest-dem-senate-victory/

Elizabeth Warren is educated and engaged. Her heart is with middle class America.

#125 Inglorious Investor on 11.07.12 at 12:09 pm

On the other hand, I applaud people who get into politics with honest intentions of affecting positive change for their communities or their country.

#126 T.O. Bubble Boy on 11.07.12 at 12:19 pm

@ #60 FTP – First Time Poster :

Why are you referring to 2007 (pre-crisis), and not 2008-2009?

Obama took office in Feb 2009.

#127 Dupcheck on 11.07.12 at 12:26 pm

Garth, the markets edged down today, I thought you said with Obama winning the markets will rally? Maybe Led was right on shorting them.

This must be the video game age. Investing attention span now = hours. — Garth

#128 Inglorious Investor on 11.07.12 at 12:30 pm

“You just lost the right to criticize. — Garth”

I have to say, that’s stupidest comment I have ever seen from you. Not only is it extremely short-sighted, but it’s also elitist.

First of all, as long as I pay my taxes and obey the law, I have every damn right to criticize, because it’s my money, and the money of other tax payers, that fund the government and pay the salaries and pensions of the politicians and other civil servants who are supposed represent me and other Canadians.

Second, if you are suggesting that it is only through political channels that one can make a positive contribution to their community or country––well, that’s just disappointing coming from you.

We can’t all be politicians. But most of can be responsible, well-informed citizens who try to understand the issues, get involved in their communities in the ways they can, make their voices heard to their representatives, and try to stand up for what they believe is just and right for their country.

Geez, what is it? The markets getting you down today?

Anyone who claims to be “too principled” to fix what they criticize deserves to be ragged. — Garth

#129 GTA Engineer on 11.07.12 at 12:32 pm

Nice market crash today everyone – 2.7% so far on the S&P. Surprised to see it happening so close after the election, but it’s real – fiscal cliffs and the business cycle, slowing earnings/revenues worldwide – it’s all now in more focus. Don’t say I didn’t warn you..

#130 John416 on 11.07.12 at 12:36 pm

“Instead of worrying about the big steaming pile of borrowed money, just focus on the monthly. As long as that’s manageable, no problem, since inevitable gains in real estate equity will wipe out the debt when you decide to walk.”

I’m 34 and I would include people under the age of 40 as “young and horny” as 10 years ago, people my age were just finishing university and decided to jump on the RE bandwagon, even with tuition debt. I worked through some of my university days and ended up with a degree in engineering and no debt. When I graduated, even I didn’t think dropping 10K into a pre-built condo in downtown Toronto made a lot of sense knowing that prices for entry level condos were well south of 300K and were only going up (and I had no equity). My expendable income was put towards travel but also equities, GICs, and yes gold. My friends thought I was crazy and they used the following logic to justify their horniness.

This was a typical conversation:

THEM: Don’t worry in 5 yrs you’ll be up 50K
ME: But with a 40 year mortgage I’m paying the bank thousands of dollars so I won’t really be up all that much in 5 years
THEM: You’re wasting your money renting
ME: But you need to live somewhere until you can occupy your new condo so you need to rent as well
THEM: Real estate always goes up. You can’t lose!
ME: Thanks but we’re getting nowhere here. Let’s agree to disagree.

I heard this enough that I almost started to believe it but my common sense overruled my RE horniness and decided to rent a really nice place downtown and wait it out until I amass a decent down payment for a place I love. Now I’m the smartest guy around (but not really!).

Looking forward to the Christmas party conversations!

#131 GTA Engineer on 11.07.12 at 12:38 pm

#114 peter on 11.07.12 at 11:26 am
When does your Obama stock market rally start? Apparently, not the day after the election.

Didn’t your mom tell you about patience? — Garth

———————-

Forget your mama – she knows nothing about investing. Nor does mine – stuck in mutual funds and refusing to listen – bah – another topic another day. Point is – listen to smarter people. Ever heard of “be greedy when others are fearful, and fearful when others are greedy”? There’s been a lot of greed lately, and the markets reflect it. If you’re relying on patience to get you returns, you’re going to wait a long time. Things are going to get worse before they get better. The fiscal cliff is just a distraction – the economy underneath is NOT healthy, and until that reverses (and it will, in time), the markets will pay the price.

But I agree – short term, whether you’re short or long – be patient. I’m long on secure investments (preferred’s, REIT’s, etc.) and short the rest (general equity).

#132 squidly77 on 11.07.12 at 12:42 pm

http://finance.yahoo.com/q?s=aapl&ql=1

http://fc08.deviantart.net/fs50/f/2009/301/2/f/Monster_Apple_by_StCoraline.jpg

Dead money. Same as people that specuvested in kitchens and bedrooms way, way up there in the sky.
AAPL can be sold in 10 seconds, unlike a condo in Kelowna, Calgary, Edmonton or the big smoke.

As I type this, your losses are being firmly locked in.

Better buy now while prices are still sky high, if you wait you will be forced to pay less whether you like it or not.

#133 martin9999 on 11.07.12 at 12:57 pm

#91picasso on 11.07.12 at 5:42 am
#35 PatientlyWatching on 11.06.12 at 10:48 pm

Yup, it’s no different then penny stock pump and dump sites. Same shite!
————–
been thinking about this for a while now. good way of approach. just hedge both sides.

thanks for the idea

#134 martin9999 on 11.07.12 at 1:02 pm

114peter on 11.07.12 at 11:26 am
When does your Obama stock market rally start? Apparently, not the day after the election.
————

Give it a couple of months, after the new years cliffy ride. finds bottom first. then pangg!!! a leg up

#135 martin9999 on 11.07.12 at 1:03 pm

SMOKING MAN

should we start shortning the euro a bit. i see 1.25 in view by mid next week max. what you think dude?

#136 martin9999 on 11.07.12 at 1:07 pm

114peter on 11.07.12 at 11:26 am
When does your Obama stock market rally start? Apparently, not the day after the election.
—-
keep in mind that back in 2008 the dow fell 4% the day after obama was elected.

#137 sm_yyc on 11.07.12 at 1:23 pm

Lamb has already accepted the writing on the wall according to a financial post article. Wonder where Cam Good is these days..

#138 anotherwhistleblower on 11.07.12 at 1:27 pm

This morning we see the first sortie of the Obama malaise crushing the expectations of investors. We can expect another 4 years of socialist inactivity and more jobs lost than any governmnet can hire or ‘create’ into existence. Say good bye to free enterprise…..this is THE game changer we have all been fearing…..spending and investing is out of the question…..tax burdens will kill any future aspirations…The US will become like Canada nad Europe…top heavy with an elite civil servant class where they get all the perks and everyone else starves. RIP ‘financial planners’…..at the rate of attrition there will be no wealth to manage.

#139 broadway skytrain on 11.07.12 at 1:32 pm

hope for america

romneys gracious and positive speech was great for america. also rom’s website streamed BO’s acceptance speech- very classy.
\
america econ is still screwed (with a 4″ robertson, coarse thread, deck screw)
so is ontario.

#140 Dontcallmeshirley on 11.07.12 at 1:35 pm

@ #118 so it begins…,

Very true, there’s 44 rental condos at 180 University alone.

Has the Toronto Star no shame?

#141 Penny Henny on 11.07.12 at 1:42 pm

114peter on 11.07.12 at 11:26 am
When does your Obama stock market rally start? Apparently, not the day after the election.
—-
keep in mind that back in 2008 the dow fell 4% the day after obama was elected.
——–
and then it dropped and dropped some more

#142 daystar on 11.07.12 at 1:44 pm

#123 45north on 11.07.12 at 12:06 pm

I’m glad someone mentioned Elizabeth Warren. This was a major victory in the senate for the Dem’s not just because of the flag she’s flying but because of her character, conviction and intelligence.

http://www.youtube.com/watch?v=YBtij5dR3dA

Good thing.

http://www.youtube.com/watch?v=A09aCUwbH0Q&feature=related

The Democratic controlled senate can’t filibuster:

http://en.wikipedia.org/wiki/Filibuster_in_the_United_States_Senate

… but they are a force:

http://elections.msnbc.msn.com/ns/politics/2012/all/senate

Republicans ran towards their defeat because of women last night from elected politicians to voters. Hard not to be engaged with the choices at hand when you have a uterus AND a brain. Republicans have this small government stance until it comes to issues like a woman’s right to control their own bodies. Double standards like that sealed their fate last night.

I wish I had time to get into what effects Elizabeth Warren is likely to have on drafting bills aimed at RE bankrupcy laws in particular but I don’t. Y’all have a good day!

#143 Bottoms_Up on 11.07.12 at 2:11 pm

#99 thinker on 11.07.12 at 9:04 am
—————————————-
A 300k home has $300/mo property tax — Oooops!
A 300k home has $500/mo maintenance — Oooops!

“Owning” a 300k home also reduces mobility and may carry significant costs to move (mortgage break penalty, agent fees etc.).

#144 luke8929 on 11.07.12 at 2:20 pm

This must be the video game age. Investing attention span now = hours. — Garth

Actually its milliseconds courtesy of HFT, no chance the market is being manipulated by those computers and rest assured no one is making bets they can’t cover and the exchanges and regulatory bodies are all over anyone who cheats.

http://market-ticker.org/akcs-www?post=213610

“The other day I wrote a Ticker in which I asked how Rochdale could put on a $700 million position in Apple with $3 million in capital. The answer is that in an honest market it could not do so as it could never clear the trade. The fact is that it is reported they did, which means the market is not honest, and this is just the latest bit of evidence.”

#145 daystar on 11.07.12 at 2:25 pm

#97 The American on 11.07.12 at 8:16 am

It was closer than electoral votes suggest. I can’t help but think states like Florida and Virginia marginally favored Obama due to Sandy. Check out the second ad (from a super pac, targeted in the east coast in states like Virginia and Florida)

http://www.huffingtonpost.com/2012/11/07/who-won-the-popular-vote-2012_n_2087038.html

I’m probably stating the obvious here but economically, folks voted Republican in congress but presidentially including the senate, other issues dominated the election from foreign policy to women and civil rights issues and at the end, climate change. Note, Romney’s speech clip in the ad took climate change right off the election as issue and look at what Sandy did to turn it around. NY, Florida, Boston (Massachussets), Philadelphia (Pennsylvania), these four states are a serious risk to rising oceans. 42 electorial votes were decided by Florida and Pennsylvania alone, thats an 84 point swing. Add Virgina (Virginia beach at serious risk to climate change) and Romney wins the election. Its hard to say how much impact ads like this had on voters or hurricane Sandy itself but Florida, Virginia and Pennsylvania were close:

http://www.politico.com/2012-election/map/#/President/2012/

Its not like Democrats had much to brag about with the economy. Their only defence was that the slowest recovery from a recession since the great depression followed the worst recession since the great depression. Obama didn’t win this election because of his economic record. I’d comment more but I really have to go.

cheers

#146 Smoking Man on 11.07.12 at 2:26 pm

#133 martin99999

now looks like a good time. 45. emloyees from greece centre bank just quit. including directors. the vote in a few hours. its tight.

get out of the way

#147 Buy Low Sell High on 11.07.12 at 2:35 pm

$400,000 @ 3.25% 25 Years = $1,944 monthly

$300,000 @ 6.15% 25 years = $1,946 monthly

#148 MP on 11.07.12 at 2:49 pm

@ #60 FTP

I won’t refute all your points, but here is a start…

“With the release of Friday’s jobs report — the last one before the election — we thought it made sense to update one of our favorite charts comparing Obama’s first term vs. George W. Bush’s first term, when it comes to jobs”

http://www.businessinsider.com/jobs-bushs-first-term-vs-obamas-first-term-2012-11

#149 EIT on 11.07.12 at 2:50 pm

short the pound, not the euro

#150 T.O. Bubble Boy on 11.07.12 at 2:57 pm

Here’s how you know the debt bubble is bursting — Kevin O’Leary is jumping into the mortgage game:

http://www.mortgagebrokernews.ca/forum/dragon-kevin-oleary-is-hot-for-mortgages-biz/124711/

(will he be the new king of sub-prime?)

#151 Tony on 11.07.12 at 2:59 pm

Re: #81 If you want to buy gold … on 11.07.12 at 2:26

Gold will likely freefall to the $850 U.S. level then hover at 500 before the next drop to the 400 level. It should bottom around the $270 U.S. level. When things go up when they should’ve gone down and the public finally gets clued in mammoth declines are in order. That’s what you’ll see in the future for gold.

#152 JustTryingToProtectEquity on 11.07.12 at 3:04 pm

http://www.allgov.com/news/top-stories/stock-market-up-68-under-obama-121023?news=846028

Sold my house in Bloor West Village in June of this year for well over asking. Got $975K for a house we bought for $325K sixteen years ago. Now rent in the same neighbourhood.

Own a 200 acre farm. Millions of dollars invested as Garth has recommended.

Read the link I’ve posted.

#134 martin9999 is right, the stock market did crash by 4% the day after Obama was elected in 2008. And it is indeed falling today. Old, angry white men are cashing in. They are afraid of their own shadows.

The US is climbing out of its funk. The next four years will be brilliant. Garth has is right.

#153 Dontcallmeshirley on 11.07.12 at 3:24 pm

@ #99 thinker,

Garth doesn’t like to do the rent calc.

However, you should include interest, property tax and selling transaction costs in yours.

I get what you’re saying,

(a) assuming a house’s sell price = bought price,

AND,

(b) transaction costs, interest and property tax = rent paid,

then owning and renting is a wash.

#154 Old Man on 11.07.12 at 3:31 pm

Is the real estate in the Province of Alberta about to crash? I need some help with the figures concerning the oil industry, as spot for light sweet crude is about $85.00. The heavy crude brought out from the so-called oil sands project costs about $30.00, so we are at $55.00 a barrel, but needs to be discounted further when sent to a refinery operation in USA; perhaps another $20.00 for a net of $35.00 a barrel.

Ok, for all you oil experts, educate me, as something simply does not add up for prosperity in Alberta going forward, or for current real estate values there. I am sure am missing something within this equation, so lets hear your thoughts, and rant away at me.

#155 };-) aka D.A. on 11.07.12 at 3:32 pm

#122Form Man on 11.07.12 at 11:58 am
DA

continuing our examination of Kelowna developments desperate for buyers…….

not wandering far from Sopa Square, we find :

Mission Meadows
Waters Edge
Southwind at Sarsons

Since these locations are all good, one is surprised at the limp demand. I will let you explain why……….

MISSION MEADOWS
http://www.missionmeadows.ca/

How can you say this project is experiencing ‘limp demand’ when they have recently broke ground on Phase III of the project which surely they would not have were demand that ‘limp’. With such a great starting price point of just $159,900 I thought about getting in on the ground floor myself which as such being an original owner you circumvent the rental restrictions. But I’m about dirt. I like the land under the improvements more than the improvements themselves.

WATERS EDGE
http://www.thewatersedgekelowna.ca/home.asp
MKS Resources has a history of building many a quality product in Kelowna and Waters Edge I expect will be no exception building upon that legacy. I have a good many friends, family and clients living in MKS product and all are quite happy. Waters Edge is the better located of the three projects you mention near a host of amenities and services with good opportunity to draw on the demand of those downsizing empty nesters in The Okanagan Mission area of Kelowna who don’t want to leave that hood.

SOUTHWIND AT SARSONS
http://southwindatsarsons.com/
Grant Gaucher did undertake an ambitious project at just the wrong time with Southwind at Sarsons but my sources tell me he is closing in on being sold out. Good on him. I think Grant was expecting to get more interest on the part of those ‘downsizing empty nesters in the Okanagan Mission’ as that was a big part of his pitch to the neighbourhood that substantially opposed the project in its initial planning phases. Took longer than I am sure Grant thought it would but he persevered and is almost there sly devil that he is.

But really Form Man each of these developments, all located in that south sector of the city known as Okanagan Mission, is doing quite well from what I can see and hear. No there are no fancy pre-sale gigs with line-ups of hired, or real prospect buyers, but really that is so…. 2008.

Did you not hear me when I said, several times, this is not a departure from norm but a return to it?

#156 Coho on 11.07.12 at 3:51 pm

#116 Inglorious Investor,

Good Post.

Seems to be a difference in what seemingly is Obama’s character and the kinds of decisions he’s made and policies he’s upheld. It can be a matter of going along to get along.

It is sad and scary at the same time that leaders sworn in to protect the American Constitution and Bill of Rights are the enablers of those whose interests lie in having it shredded thus usurping whatever power the people have left and the American way of life with it.

#157 Coho on 11.07.12 at 3:56 pm

And just to be clear where the people figure in with our government — our MP’s swear allegiance to the Queen. So, British wars are our wars. British conquests are our conquests. We’re going to be dragged into foreign entanglements whether we like it or not.

False. — Garth

#158 Hoof - Hearted on 11.07.12 at 4:05 pm

Okanagan?……

I said it before and I will say it again….Okanagan was used as a dumping ground for those that grabbed HAM $$$ and took off. The Coquihalla highway was built “coincidentally” about the time HAM came in from Hong Kong.

Connect the dots…

Okanagan….overrated superinflated..soon to be ghost town area.

#159 Really on 11.07.12 at 4:15 pm

Hey Garth,

I missed the real estate run. My friends and family, who got in it, did really well. Even the ones that haven’t sold have a ton of equity. Btw, I’m referring to 1999-2008 real estate run. We missed it all. Our bad. Our problem. Our angst.

We are renting and are fine with it now (well truthfully we are resigned to it, but of course feeling smarter everyday).

People are entitled to make their own decisions and to live and die by them.
My concern about real estate at this point is that our government will do “something” to help out homeowners who (bought unwisely) and our now suffering as a result of that purchase.
I strongly believe the market should look after the market – NOT the government. I and hopefully hundreds of thousands of others will not stand by while our government responds to our housing crises (that is almost detectable by normal people) by doing something that artificially holds the market up benefiting those who made irresponsible decisions while punishing further those who didn’t.

Garth youve served in senior cabinet post in federal stage. Can you identify a few things that our government might be tempted to do that would be “unfair” to non-homeowners? Can you list some of those so that your hundred thousand readers can be ready to fight any moves the federal government tries to do.

I’m happy for everyone who owns real estate to make a profit – they took a risk and they have been rewarded for it. But I will not be a part of helping people who took risks – not with my money.

I don’t want to see foreclosure rule changes , subsidized payments by government – I dont want ANY interference with the market.
Our mantra should be “privatized profits and privatized losses”. Not privatized profits and socialized losses”. This would be unacceptable.

This type of attitude needs to be shut down right at its point of inception.

A post (preferably twenty) Garth about what the government will be “tempted” to do but SHOULD NOT do.

#160 freddie krugerand on 11.07.12 at 4:35 pm

Garth – need proof that individuals seeking safety flock to gold?

Look at Iran, where demand for the metal is growing as the impact of sanctions becomes more severe.

As life in Iran becomes more expensive and more difficult, its inhabitants are turning to gold to cope with the vicious bite of sanctions.

Iran sold over 2 million barrels of oil per day last year, but only about 1 million barrels a day in October.

The rial, is rapidly losing value and hyperinflationary conditions are worsening. Even meat consumption has declined.

But as conditions in the nation deteriorate, the amount of yellow metal that Iran is funneling in from its neighbors is on the rise.

In 2010 and 2011 combined Turkey’s total gold and jewelry exports amounted to $4.3 billion

In the first six months of 2012, gold exports to Iran are a gold export figure in excess of $6 billion.

Couriers carrying millions dollars worth of gold bullion in their luggage have been flying from Istanbul to Dubai, where the gold is shipped on to Iran by boat.

Another example of global demand up, and overall gold supply is down – or even having reached ‘peak gold’.

Tell me again why having 5-10% of a diversified portfolio as physical gold bullion in your possession isn’t a good, liquid idea?

Because this isn’t Iran. — Garth

#161 mel in victoria on 11.07.12 at 4:42 pm

#150 TONY……….

You are right. I sold all my PM holdings today!! Thanks for your sage advice….

#162 martin9999 on 11.07.12 at 5:17 pm

#145Smoking Man on 11.07.12 at 2:26 pm
#133 martin99999
—-
if we close below 1.27700 today i think we hit 1.25 at no time and opens the way for a new selloff. 1.15 in view no doubt about that

greece problems with a touch of fiscal cliff, should do the job this time

#163 martin9999 on 11.07.12 at 5:17 pm

i am gonna put some big bets out there. cant wait

#164 Inglorious Investor on 11.07.12 at 5:31 pm

“Anyone who claims to be “too principled” to fix what they criticize deserves to be ragged. — Garth”

As I said in an earlier comment, I applaud people who become politicians with sincere intentions to help their fellow citizens. I have known a few elected officials, and people who have worked for elected officials. My own cousin is a city councillor.

From what I’ve seen. politicians must be willing to compromise their principles in order to remain politicians. This is not a criticism of the individual per se, but a reflection of political reality. I am simply not willing to compromise my principles. Sorry. So, I’d make a terrible politician. Rag away.

There are many ways an individual can contribute to society outside of party politics. But if nothing else, people should at least get informed about the issues that can impact their communities and their country, and try to get involved as much as they can in whatever way they are able.

Elected officials must be held to account for a variety of very good reasons. An ignorant, indolent populace does not live up to this responsibility. Was it Tocqueville who said that people get the government they deserve?

#165 Junius on 11.07.12 at 5:36 pm

#120 FTP – First Time Poster,

You said, “I love these debates and dont take them personally, but just so you know, I dont have a guy – or a vested interest.”

Hard to believe when you make such a deceptive and simple comparison. Using 2007 numbers doesn’t take into account the financial collapse in 2008 that happened during the Bush administration prior to Obama even being elected.

Like Obama or not your example are deceptive and not legitimate for the purposes of debate.

#166 Old Man on 11.07.12 at 5:37 pm

Memo For Smoking Man – I bet on the wrong horse for the US election, and it cost me, so how did you know? I am having my Amish housekeeper feeding me cake all day long, as she just laughs by saying the Smoking Man knows the machine, and you do not.

#167 Barry Lainof on 11.07.12 at 5:41 pm

# 60 FTP

You just described the Bush legacy. — Garth

In fact he just described the Clinton presidency that got rid of Glass-Steagle, a Senate and House of Representatives from 1992 (possibly earlier) to the present that treat public finances without regard for consequences of profligate spending, a Bush presidency without an end game for Afganistan and Iraq other than revenge and establishing a military base(s) in the Middle East and an Obama presidency more concerned with ideology than rule of law. Where have been the DOJ investigations of big banks, mortgage brokers, derivative insurers and politicians trading on inside information.

I trust you fought within the Canadian government and bureaucracy during you’re time in Ottawa to prevent this type of governance. Therefor, I’m surprised at your diverting attention from the valid points made by FTP and placing blame and attention on Bush rather than Obama. From what I’ve observed, there is plenty of blame to spread around on both parties and many administrations.

#168 anotherwhistleblower on 11.07.12 at 5:44 pm

So it begins…Obama’s first comments are about raising taxes of small businesses and raiding capital gains taxes for ‘revenue’. Sounds like a page out of the NDP playbook. You’d think the DEMS were planning this all along ..Clinton announces the ZIRP that rapes all savers and then surreptitiosly juices inflation with Greenspans Fiat Ponzi to kill any incentive to save. The Dems believe that if all people have to depend on the government for their daily bread than they can do anything they want. The Liberal Party did much the same with the Newfies when Fisheries under Crosbie killed the salmon and wrapped the dead fish in welfare cheques. It assured the Libs that the dependant Newfies would have to vote Liberal just to eat.

We are looking at a welfare state as is the US…..a tilt towards totalitarianism based on suffering and dependancy. The only people who win big in this scaenario are the pensioned up civil servants and unions who have cradle to grave paycheques and wil never need to save a nickel. They show up to vote for the status quo…and the majority gets screwed.

I’ve got news for you….F is a liar…..the media is a whore…..we are already in recession and they are playing silly buggers with the stats to try and make the public go back to sleep.

Of course, who gets his information from the sales staff where he works will invoke censure on this as he usually does.

#169 thinker on 11.07.12 at 6:01 pm

Great responses on the “Unrealized Loss on property vs Realized Rent Losses”

I think we are now moving in the right direction, if one is saying – Get out of housing and rent, we need to know the upside of renting. Owning will always cost more then renting, that is the cost of the call option (property prices have gone higher and people will pay a premium for that right) It doesn’t have to equal.

In our last example Garth

300k loss of 15% = -45k
1750 a month rent = -42k

However, assume that the property is goes back to 300k after the next 10 years….you would have lost so much money renting over 200K.

This would destroy the punter/flipper, but someone looking to own for a long period, does it really matter where you put in the pin?

#170 Hoof - Hearted on 11.07.12 at 6:08 pm

#167 anotherwhistleblower on 11.07.12 at 5:44 pm

Review Weimar Republic

I had thought Romney would win….(maybe he actually did …who knows anymore ?) .

Regardless…Marxist Barky Obama and his handlers will have the US on its knees in the next 4 years…” Yes We Can ”

(NOTE good thing we in Canada have the border to protect us !!!)

#171 bill on 11.07.12 at 6:08 pm

#166 Barry Lainof on 11.07.12 at 5:41 pm
” there is plenty of blame to spread around on both parties and many administrations.”
I agree . both parties have some explaining to do …

#172 Alex N Calgary on 11.07.12 at 6:28 pm

Wed at the law firm. Real Estate agent is fighting over her comission of 130k on a 3Mil$ house. Seriously? 130,000$ for being a salesperson for a house? I betcha that 130ky goes right into building townhouses, that’ll go right down the crapper, the adjustment can’t come fast enough.

#173 Eaglebay - Parksville on 11.07.12 at 6:31 pm

#128 GTA Engineer on 11.07.12 at 12:32 pm
“Nice market crash today everyone – 2.7% so far on the S&P.”
________________
This is not a market “crash”.
A market crash is when a bridge falls down. That’s a crash.
Hope you’re not a real engineer, if so tell us which bridge
you’ve been involved with.

#174 Tony on 11.07.12 at 6:37 pm

Re: #168 thinker on 11.07.12 at 6:01 pm

Check out the thousands of one bedroom foreclosures in Edmonton. It costs less than half of what it would cost to rent if you bought these places with zero down to own.

#175 prairieperson on 11.07.12 at 7:02 pm

The focus, naturally, is on Canada’s two most important cities. Lotta money, people, business. However, scattered across the land are small towns where houses, not so long ago, could be bought for 20-50k. One small town I looked at, 8,000 in the whole municipality, has houses for sale for around 900,000 to 1,2M. Many others for 550-750. I know it is small potatoes re TO/Van , Garth, but could you have a column that looks at small town prices, the reason for them and their likely fate? I can’t make any sense out of it. There’s lots of land in the 3 prairie provinces.

#176 Mr Buyer on 11.07.12 at 7:09 pm

How do bubbles collapse? Well in Japan it has been 21 straight years of property price decline (most of that front loaded) with the media saying the recovery is beginning all throughout the horrendous process.

#177 TurnerNation on 11.07.12 at 7:30 pm

Today the markets Obamacided. While it may lead to a buying opp I’ve been urging caution since a few weeks ago.

#178 I stand corrected! on 11.07.12 at 7:35 pm

You know it’s not going to end well when you have neighbours like mine just move in next door. A nice young couple moved into the house next door a couple of months ago. He drives a huge truck for I guess some kind of construction job. Haven’t really talked to him yet. She is a pretty little blonde, no complaints there. The first day it snowed I thought I would do them a favour and shovel their walk. While doing this out pops the girl with their little rat of a dog. She says she didn’t go to class today because of the snow. I say. oh are you a teacher then? No she exclaims, I go to university! What, university? And you can afford to buy a house. Mortgage and student debt. This isn’t going to end well!

#179 Junius on 11.07.12 at 7:44 pm

#166 Barry Lainof,

You said, “From what I’ve observed, there is plenty of blame to spread around on both parties and many administrations.”

This is true. However the Republicans continually try to use these sort of charts and figures to contrast Obama with Bush or other Presidents but leave out the crash of 2008. It is a deceptive practice.

Let’s face it, George W. Bush was probably the worst US President in history and perhaps the worst democratic leader of all time.

#180 Blacksheep on 11.07.12 at 7:50 pm

Smoking Old mans writer,

“Memo For Smoking Man – I bet on the wrong horse for the US election, and it cost me, so how did you know? I am having my Amish housekeeper feeding me cake all day long, as she just laughs by saying the Smoking Man knows the machine, and you do not.”
—————————————————————-
A master of Subtlety, you are not.

take care
Blacksheep

#181 TurnerNation on 11.07.12 at 7:57 pm

From a local, Toronto, condo’s facebook group…

“Did anyone notice an increase in their property tax? We were reassessed a month ago and it has been increased significantly.”

“- Mine said 10.11% this year alone.That’s going to hurt!
– Increase of 9.79%
– Mine was over 12.5%…”

…are the replies. Welcome to “FordNation”.

#182 Form Man on 11.07.12 at 8:03 pm

#154 DA

good try at a deflect. The question wasn’t whether these are good developments in good locations. What you failed to answer is why they aren’t selling

Sarsons – been trying to sell it out for years now
Mission meadows – sales are a trickle, construction very slow
Sopa- stopped…….not enough sales
Waters edge – been trying to sell it out for years now

#183 Nostradamus Le Mad Vlad on 11.07.12 at 8:17 pm

#63 Smoking Man — “Humanity is embarrassing.” — I know, but someone has to make up the masses!

#109 };-) aka D.A. — Excellent post and so true. I didn’t get much formal education, but I’m getting as many of life’s adventures and experiences, so that I’m in reasonably good shape.

#139 Dontcallmeshirley — “Has the Toronto Star no shame?” — They’re m$m, and obviously don’t know what shame is.

#148 EIT — “short the pound, not the euro” — What about shorting them both and picking up renmibi and roubles to replace them with?

#157 Hoof – Hearted — “Okanagan….overrated superinflated..soon to be ghost town area.” — If a nuke wipes out the tri-cities area, then you’re right. But whadda I care? I’ll be enjoying the after-life!

#159 freddie krugerand — “The rial, is rapidly losing value and hyperinflationary conditions are worsening.”– It will be interesting when and if China changes to a gold-backed renmibi. If it does happen, a lot of countries will ditch the petro-dollar by replacing it with something a lot more stable. Good post.

#184 GTA Engineer on 11.07.12 at 8:19 pm

#172 Eaglebay – Parksville on 11.07.12 at 6:31 pm
#128 GTA Engineer on 11.07.12 at 12:32 pm
“Nice market crash today everyone – 2.7% so far on the S&P.”
________________
This is not a market “crash”.
A market crash is when a bridge falls down. That’s a crash.
Hope you’re not a real engineer, if so tell us which bridge
you’ve been involved with.

——————

Lol – ok, you got me. ‘crash’ was perhaps a bit of an overstatement/hyperbole. However, the markets *have* suffered the largest drop in 5 months, which is not insignificant.

By the way, I wager to bet that less than 1% of engineers build bridges, so I’m hopeful you too are just using hyperbole and are not just ignorant. Engineering can be civil (including structures like bridges), mechanical, electrical, computer, aeronautical/aerospace, surveying, and software. I built a bridge out of spaghetti in high school for physics class and haven’t touched one since. But you’re right – it did break pretty easily ;) I don’t build bridges for a living – I’d be pretty bad at it..

#185 M G on 11.07.12 at 8:21 pm

http://usdebtclock.org/

#186 };-) aka D.A. on 11.07.12 at 8:26 pm

#157Hoof – Hearted on 11.07.12 at 4:05 pm
Okanagan?……

I said it before and I will say it again….Okanagan was used as a dumping ground for those that grabbed HAM $$$ and took off. The Coquihalla highway was built “coincidentally” about the time HAM came in from Hong Kong.

Connect the dots…

Okanagan….overrated superinflated..soon to be ghost town area.

The number Albertans who have bought Okanagan real estate since when the Coquihalla was built far, far outnumbers those British Columbians from its lower mainland who did.

The Okanagan is not ‘overrated’ nor ‘superinflated’ but remains a most sought after place for they who live and work in less desirable places to recreate and someday retire. The lower mainland of British Columbia is similarly endowed that there simply is little incentive for anyone who lives there to move to the Okanagan.

Connect the dots…

#187 anotherwhistleblower on 11.07.12 at 8:34 pm

#169….The US….like Canada…..and UK for that matter have all become watered down affirmative action welfare programs living off the achievments of the past.

As times get tough more people swing towards the government promising the biggest handouts out of desperation……the left wing votes to dillute the entrpeneurial spirit that created national wealth in the first place…ipso facto…increased immigration of the planets impoverished uneducated masses on top of programs like political correctness and affirmative action produce lower quality everything….. inc doctors , lawyers engineers and especially buisness leaders ….( please show us an example of a minority immigrant JP Morgan or Bill Gates) dependant minorities creates a death spiral for commercial expansion…..and the eventaul rollover of western civilization through attrition and the dictatorship of the needy. Basket ball height and taco stands will not save the economy.

Frankly…I want the doctor who got the highest marks…not the one who was given a seat because of skin color….I want to drive across a bridge designed by the top guy in the class not an immigrant who ‘deserves a government job. The Liberals love for Obama is the death knell they long for…..be careful what you wish for….you just might get it.

Welcome 4 more years od recession……and btw…..bwahahahahahahahahahahahaaaa did you catch Obama asking Romney to help him fix the economy. Kooky how you can channel Martin Luther King to wow the audience and get elected president and in the same breath start bawling because you’re over your head and haven’t a clue how to be a leader.

Yes we can………destroy the economy of the free world. I wonder if the Chinese will be so magnanimous when they send the Red Army over to dictate our surrender?

#188 Observer on 11.07.12 at 8:48 pm

Obummer’s back in. (I thought for sure they were tired
of him)
Bernanke stays.
Money printing continues.
The gold pumpers might be right after all.

#189 a prairie dawg on 11.07.12 at 8:50 pm

on Lang & O’Leary on CBC:

They had a banner stating that 1/3 of Canadians polled were relying on the Lotto or an inheritance to fund their retirement.

– – –

There’s going to be some extremely surprised and angry people when that doesn’t happen for most of them.

#190 EIT on 11.07.12 at 8:59 pm

182 Nostradamus Le Mad Vlad on 11.07.12 at 8:17 pm

Great Britain has an Icelandic debt to GDP ratio. I never thought I would see the City of London implode. As for the ECB, these big central banks are like the F’in terminator, they give me the heebeegeebees.

#191 MarcFromOttawa on 11.07.12 at 9:24 pm

“By the way, many people are attributing the stock market decline to the election of Obama. I was up at 3:00AM and the futures were still green. Futures turned red following comments by ECB president Mario Draghi regarding economic weakness in Germany.”

http://globaleconomicanalysis.blogspot.ca/2012/11/dreadful-economic-data-in-germany-italy.html

#192 Bill Gable on 11.07.12 at 9:25 pm

The writing just keeps getting better and better – and this a dandy post.

Bravo Zulu, Big G.

(*The audio cast was insightful today – thanks!)

#193 Canadian Watchdog on 11.07.12 at 9:33 pm

Which Professions Have The Most Psychopaths?

Sorry Garth, metalheads didn’t make the list. But #1 in interesting.

#194 Smoking Man on 11.07.12 at 9:34 pm

#165 Old Man on 11.07.12 at 5:37 pm

LMAO

You are wit

#195 Old Dad on 11.07.12 at 9:59 pm

#153 Old Man on 11.07.12 at 3:31 pm
Is the real estate in the Province of Alberta about to crash? I need some help with the figures concerning the oil industry, as spot for light sweet crude is about $85.00. The heavy crude brought out from the so-called oil sands project costs about $30.00, so we are at $55.00 a barrel, but needs to be discounted further when sent to a refinery operation in USA; perhaps another $20.00 for a net of $35.00 a barrel.

Ok, for all you oil experts, educate me, as something simply does not add up for prosperity in Alberta going forward, or for current real estate values there. I am sure am missing something within this equation, so lets hear your thoughts, and rant away at me.
++++++++++++++++++++++++++++++++++

You forgot the part that natural gas is selling for a $2 handle and is now considered a waste product. That and that Suncor says it needs $90/bbl for oil and oil is in the low $80’s.

It is different in Calgary. It’s even more delusional that Van or TO.

#196 Hoof - Hearted on 11.07.12 at 9:59 pm

#185 };-) aka D.A. on 11.07.12 at 8:26 pm

Alberta? perhaps…..but still due to be ghost town area.

#197 Grooby on 11.07.12 at 10:15 pm

#99 thinker on 11.07.12 at 9:04 am

If you’re paying 1,750 to rent a 300k house, you are getting ripped off and then some.

I rent a 3 bedroom inner city house valued at ~800k (for now) for $2,000.00/mo, and rent hasn’t changed for almost 4 years.

Time to shop around.

#198 Grim Reaper/Crypt Speculator on 11.07.12 at 10:22 pm

#188 a prairie dawg on 11.07.12 at 8:50 pm

on Lang & O’Leary on CBC:

They had a banner stating that 1/3 of Canadians polled were relying on the Lotto or an inheritance to fund their retirement.

=================================

Hey …….its the only way SmoKingKongMan aka Old Man will ever “get lucky” !!!!

#199 Herb on 11.07.12 at 10:29 pm

anotherwhistlblower,

is that you, Truth Hammerer?

#200 Kingarthur on 11.07.12 at 10:31 pm

Hey Garth: I hate to repeat myself, but location still counts:

http://www.vancouversun.com/Snow+Edmonton+Blast+winter+brings+whiteout+conditions+chaos+roads/7514309/story.html

On second thought. you repeat yourself quite a bit.

#201 DonDWest on 11.07.12 at 10:42 pm

#192 Canadian Watchdog

“Which Professions Have The Most Psychopaths?”

Surprised teaching was one of the professions deemed to produce less psychopaths. I would put teachers at number one and the CEO a close number two.

The people working at the Huffington must have only included your harmless sub teacher or adjunct. They have obviously never ran into tenured university professors, school administrators, and teachers nearing retirement. These people could literally be classified as social engineers, how is that not a psychopathic trait? I had a laugh at the observation “teaching is a profession without a lot of power.”

And they put “civil servant” in as number 10, however a police officer (number 7) is also by definition a civil servant. Seeing that they obviously made up a list without any science to back it, I’ll make my own:

1. Teachers/professors
2. CEO
3. Politicians
4. Police officers
5. Religious leaders
6. Media
7. Real estate agents
8. Stock brokers
9. Physicists
10. Military officers

#202 If you want to buy gold ... on 11.07.12 at 11:58 pm

#150Tony – What the hell are you talking about … that was gibberish.

#203 cynically on 11.08.12 at 4:22 am

#61&102 FTP – The Amarican at #104 is right – you are a friggin idiot!

#204 house burden on 11.08.12 at 5:59 am

This feels a bit like the Asian Contagion years ago + the Euro debt crisis all in one. Add a possible housing collapse.

Just waiting to hear the news of additional stimulas needed to fund and expand the existing government and the banks.

I sure hope Obama does the right things and put some effort fighting the Debt which over shadows the US, but I’m confident that he’ll do the wrong thing and continue to print more money. (out of thin air!) . God Bless

http://www.brecorder.com/markets/equity/asia/89579-asian-markets-hit-by-us-fiscal-cliff-fears.html

If China starts to fall, expect their Housing Bubble to also crash.

#205 Realist on 11.08.12 at 10:39 am

>>Eventually a political compromise will emerge and the odds of recession melt away.

Or rather, it would, if the only cause were the ‘fiscal cliff’ in the US.

Your infantile analyses of areas which you don’t understand are always good for a laugh.

Without a political shock, there will be no US recession. No matter how much you hope for one or substitute abuse for logic. — Garth

#206 Mike on 11.08.12 at 11:32 am

Re: #168 thinker on 11.07.12 at 6:01 pm

Check out the thousands of one bedroom foreclosures in Edmonton. It costs less than half of what it would cost to rent if you bought these places with zero down to own.
************************

Details? I’m moving to Edmonton at the end of the month and looking to rent (1 bd apt’s are going for about $1000 per month). Where are these $500/month apt’s to be bought found at?

#207 NI on 11.08.12 at 2:45 pm

Am I hearing “a buy opportunity is coming up”?

#208 REAL ESTATE: “Substantial declines in home sales are usually a precursor of home price corrections.” | on 11.10.12 at 11:41 am

[…] “It is reported that home sales in Vancouver and Toronto metropolitan areas dropped by 20-33% in September from a year ago. Substantial declines in home sales are usually a precursor of home price corrections. While almost all high loan-to-value mortgages in Canada have guarantees from government backed entities, a housing correction will likely impact consumer finances and aggravate credit card ABS credit performance” Word is getting out there pretty fast now. Housing market correction = recession in Canada.” – Toronto_CA at greaterfool.ca 7 Nov 2012 10:04am […]